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Effective April 1, 2010, food products that are grown, made or processed in Mississippi and sold from farmers’ markets that have been certified by the Mississippi Department of Agriculture and Commerce are exempt from Mississippi sales and use tax (H.B. 1566, Laws 2010, effective as noted).


In a recent State of the State address, Mississippi Gov. Haley Barbour expressed that he does not support state tax increases nor tax amnesty programs as solutions to current budget issues. Alternatively, the governor called for a small increase in the Tax Commission budget for collecting unpaid taxes owed to the state (2010 State of the State Address, Mississippi Gov. Haley Barbour, January 18, 2010).


The Mississippi State Tax Commission has issued a notice concerning the 1.5% reduced state sales tax rate on purchases of farm tractors, farm implements and parts and labor for agricultural purposes beginning July 1, 2009. A farm tractor is defined as self-propelled equipment which performs no farm function other than to move, draw or furnish power to other implements which may be attached. A farm implement is a complete unit that performs a specialized mechanical function and is identifiable as a specific piece of equipment that is ordinarily and customarily used on a farm. All parts and labor purchased for the maintenance and/or repair of farm tractors and implements are also subject to the reduced 1½% rate of sales tax. If a tractor is purchased for non-agricultural purposes, it is subject to the full 7% rate of sales tax.

Farmers purchasing farm tractors, farm implements and parts and labor for the maintenance and/or repair of farm tractors and farm implements are required to provide copies of their completed and notarized Farmer’s Affidavit to each vendor to be eligible for the reduced rate. The Farmer’s Affidavit expires December 31 of each year, and a new Farmer’s Affidavit should be completed each following year and provided to each vendor. Auction companies selling farm tractors, implements and parts at the reduced 1.5% rate are required to obtain a copy of a notarized Farmer’s Affidavit from the customer to validate charging the reduced rate. (Notice 72-09-006, Mississippi State Tax Commission, September 24, 2009, released October 2009)


The Mississippi State Tax Commission has been reorganized under new legislation. The Department of Revenue will now handle administrative functions. A newly established independent Board of Tax Appeals will now have authority over administrative appeals effective July 1, 2010. The Board of Tax Appeals will not be subject in any way to the supervision or control of the Department of Revenue. It will consist of three members, including a chairman and two associate members, who will be appointed by the Governor, along with approval by the Senate. The Board will have the power to adopt, amend, or repeal rules and regulations necessary to implement its duties.

Except for those powers and duties devolved upon the Board of Tax Appeals, the newly created office of Commissioner of Revenue, acting through the Department of Revenue, will exercise those powers and duties formerly assigned to the State Tax Commission. In addition to the reorganization of the State Tax Commission, the legislation also increases the statutory notice period for appealing assessments from thirty to sixty days, as well as the time period to pay certain tax assessments and damages. Also under this new legislation, surety bonds, which are required to be accompanied upon taxpayer appeal from an order of the Board of Tax Appeals, will be reduced from twice the amount in dispute to half the amount in dispute. (S.B. 2712, Laws 2009, effective as noted).


Effective July 1, 2008, sales of software or software services transmitted by the internet to a destination outside of Mississippi are exempt from state sales and use tax, provided the purchaser’s first use of the software or services occurs outside the State of Mississippi. (S.B. 3173, Laws 2008, effective July 1, 2008)



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